County wants to pick electric supplier rather than seeks bids
DANVILLE — Vermilion County officials want to go ahead and choose Integrys as its alternative electric supplier rather than seeking bids for a program that would pool county residents into one energy account.
Earlier this spring, the Vermilion County Board agreed to ask voters in November for the authority to negotiate lower-priced electricity rates on their behalf. If voters agree, then the county chooses an electric supplier that will negotiate a lower electric rate on behalf of county residents, except for those served by rural electric suppliers. This spring, voters in Champaign and Urbana agreed to let their municipalities negotiate on their behalf, but the cities waited until after the referendums to contract with electrical suppliers and sought bids when choosing suppliers.
Vermilion County officials want to sign an agreement right now with the electrical supplier, Integrys Energy Services based in Chicago, prior to the referendum in November. According to the proposed agreement, Integrys can begin signing up customers this summer. By law, all residents must be given the chance to opt out of the program.
Vermilion County Board Chairman Jim McMahon said those who sign up this summer will get a reduced electric rate now even though the referendum has not taken place, and the advantage to the county is that Integrys will cover the cost of putting the question on the November ballot and cover expenses like mailings to residents and other promotional costs prior to the referendum. If voters give their approval, the agreement also gives the county a cut of whatever savings Integrys negotiates.
"It's a win win when we can save (taxpayers) money and offset some of the costs of the county without raising property taxes," McMahon said of the proposed agreement that the county board's executive committee will consider at its monthly meeting at 4:30 p.m. Thursday at the Vermilion County Courthouse Annex, 6 N. Vermilion St., Danville.
After analyzing bids from various electric suppliers, the Champaign City Council decided Integrys had the best deal and approved, last week, a two-year deal, locking in a price of 4.15 cents per kilowatt hour for electricity, which is about 33 percent less than what they would pay without a program.
And earlier this month, the Urbana City Council analyzed its bids and signed a contract with Homefield Energy, which will supply 100 percent renewable electricity to Urbana residents at a rate of 4.08 cents per kilowatt-hour, which is about 35 percent less.
Although Vermilion officials want to enter into an agreement now with Integrys, McMahon said, the company is still estimating that it will be able to negotiate similar savings around 30 percent.
Illinois' electric market was deregulated by the Illinois General Assembly in the late 1990s, and commercial and industrial customers were the first to take advantage of the opportunity to realize savings by choosing their electric suppliers. Although the supplier changes, the company that delivers the power remains the same. According to Integrys, about 80 percent of Ameren's non-residential load is served by alternative electric suppliers, like Integrys. Now, that opportunity is available to residential customers.
Currently, individual customers can choose their electric suppliers, but pooling large numbers of residents and smaller commercial customers creates more buying power and a better opportunity for lower rates.
In 2010, the Illinois Legislature gave local governments, including counties and municipalities, the ability to contract with an electric supplier and pool residents and small commercial customers. Those who participate in the program will still receive their bills from Ameren, which will still own the distribution system and be responsible for the delivery of the power.